Influx of cheap imports hurt Zim firms

COMPANIES in Zimbabwe are still being heavily affected by the influx of cheap imports from countries such as China, South Africa and India, despite government having introduced Statutory Instrument 64 of 2016 to counter that, NewsDay has established.

BY MTHANDAZO NYONI

Briefing Industry minister Mike Bimha during tours of companies in Bulawayo yesterday, the businesses said imports were still being smuggled into the country despite SI 64 of 2016 having been promulgated.

“We have been highly affected by an influx of imports and this has affected our production. We have been struggling in the past five years. What is worrying us is that imports are still coming in despite SI 64 of 2016 having been introduced. There are loopholes in the implementation of the SI, for example, importation of fabric reinforced belts disguised as steel coded belts,” General Beltings general manager, Joseph Gunda said.

He said his company’s performance has been affected. Gunda said their plant was closed for one-and-a-half months and workers were sent home, as there was no business.

“The workers were called last week due to orders we received from local mines. Current orders, valued at $300 000, will be completed by August 17. Thereafter, there will be no work, we will have to send workers home again,” he said.

Gunda said, given strict and full implementation of the restrictive measures on imports, their company would be a success story of government intervention to revive the manufacturing sector within a short period.
Mealie Brand managing director, Walter Chigwada said they have lost market share due to competition from cheap imports.

He said producing a plough locally costs $58, but imported ones land in the country at only $35.
Chigwada asked the government to include companies in the agriculture sector like his, in the SI 64 of 2016.
Bimha promised to look into the issues.

“The environment has been very tough due to imports and, as government, we are working very hard to ensure that local industries are capacitated,” he said.

The tours were held on the sidelines of the Confederation of Zimbabwe Industries 2016 annual congress, which kicked off yesterday in Bulawayo.

Government recently introduced stringent regulations meant to control the importation of goods that are available locally. The regulations were gazetted under SI 64 of 2016 by the ministry of Industry and Commerce.
The CZI congress is running under the theme Strengthening Value Chains for Sustainable Industrialisation and Economic Development. The congress ends tomorrow.

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7 Comments

  1. The manufacturers are into production for the profit. They are not doing any of us a favour because they are not into charity work. They cannot and should not expect us the consumers to do them a favour. We buy goods and services based on affordability, quality and durability. They should learn to produce with these three basic principles in mind, that is produce quality, affordable and durable goods like their external competitors. Government is more interested in protecting the manufacturers at the expense of consumers. We say kwete!

  2. So effectively the cost of a plough has increased from at least $35 to $58, a a whopping 66% increase. This increase is affecting thousands of hard pressed farmers to line the pockets of a few company owners paying a few workers marginal wages. So SI 64/2016 is disadvantaging thousands of poor farmers because it is protecting industries in which we have no comparative advantage. The people are the losers from higher prices and lower quality. How can our local producers be so much more expensive even after accounting for import duties and shipping? The consumer is the victim here. If we fix the economy then there will be no need for hapless bureaucratic interventions such as SI64.

  3. Dear Newsday reporter, can you please make proper research before publication. For instance why is it that General Beltings only has an order book of US$ 300 00? Could it be because the mines are struggling to stay afloat in the first place? Why not establish the products they manufacture and find out from Mining buyers why they do not go local? Secondly, before SI64 of 2016, one already needed a lince from Bimha’s ministry. I know because I tried importing some industrial hoses which local manufacturers do not have and had to go through this process. So in all honesty, as far as General Beltings is concerned this SI would not have made any difference.

  4. imported $35 locally manufactured $58 uuhh where is consumer council of Zimbabwe??!!!???

  5. companies should stop producing for 100% profit, that was based on the zim $ era. aiming at 10% profit a year is so good in the us $ era. as a company you buy that new Isuzu car for your ceo after 5 years of hard work. our business people even farmers are still exploiting people. is there a reason for selling even cabbage for a dollar. not at all.

  6. please Newsday, we respect your balanced reporting in this current environment, but our request as God fearing people is,

    kindly put descent pictures, so that your newspaper is for all kinds of poeple

  7. Tonderai Tonde

    I understand business involves competition, and as much as we may like to support our industries they seem not to empathise with us. Instead of luring customers by making affordable products, they form cartels, create artificial shortages so as to increase profits then at the end of the day lobby the govt to force us to support them. That’s totally irrational as no sane person can opt to buy expensive necessities in the current environment.

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